Your Down Payment

Lots of borrowers can easily qualify for several different kinds of mortgages, but they don't have a lot of money to pay a down payment. We have a few ideas

Cut expenses and save. Be on the look-out for ways to trim your expenses to set aside funds for a down payment. You could also try enrolling in an automatic savings plan to automatically have a set portion of your paycheck moved into your savings account. You might look into some big expenses in your spending history that you can give up, or trim, at least temporarily. For example, you may move into less expensive housing, or stay local for your family vacation.

Work more and sell items you don't need. Maybe you can get a second job to get your down payment money. Additionally, you can make an exhaustive list of items you may be able to sell. Unworn gold jewelry can be sold at local jewelry stores. A closetful of small things may add up to a nice sum at a garage or tag sale. Also, you can look into selling any investments you own.

Tap into your retirement funds. Check the provisions of your particular program. It is possible to take out money from a 401(k) plan for you down payment or get a withdrawal from an Individual Retirement Account. Be sure you understand about any penalties, the way this may affect on your income taxes, and repayment obligation.

Request a gift from family. First-time homebuyers are often lucky enough to receive down payment assistance from giving family members who may be prepared to help get them in their own home. Your family members may be willing to help you reach the goal of buying your own home.

Contact housing finance agencies. These agencies offer provisional mortgage programs for low and moderate-income buyers, buyers with an interest in remodeling a home within a particular area, and additional certain types of buyers as defined by the finance agency. Working with this type of agency, you can receive a below market interest rate, down payment help and other advantages. These types of agencies can assist you with a lower rate of interest, get you your down payment, and offer other advantages. The principal mission of not-for-profit housing finance agencies is boosting the purchase of homes in specific places.

Learn about low-down and no-down mortgage loans.

  • Federal Housing Administration (FHA) loans

    The Federal Housing Administration (FHA), which functions as part of the U.S. Department of Housing and Urban Development (HUD), plays an important part in helping low to moderate-income Americans get mortgages. An office of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) helps individuals get FHA offers mortgage insurance to the private lenders, enabling homebuyers who will not qualify for a typical mortgage, to receive financing. Interest rates with an FHA mortgage are usually the going interest rate, but the down payment with an FHA mortgage will be lower than those of conventional loans. Closing costs can be included in the mortgage, and the down payment can be as low as 3 percent of the total.

  • VA mortgages

    Guaranteed by the Department of Veterans Affairs, a VA loan qualifies veterens and service people. This specialized loan does not require a down payment, has mimimal closing costs, and provides a competitive interest rate. Even though the VA doesn't actually finance the mortgage loans, it does issue a certificate of eligibility to qualify for a VA loan.

  • Piggy-back loans

    A piggy-back loan is a second mortgage that you close along with the first. Most of the time, the first mortgage covers 80% of the purchase price and the "piggyback" is for 10%. The homebuyer covers the remaining 10%, instead of come up with the usual 20% down payment.

  • Carry-Back loans

    In the option of the seller "carrying back a second mortgage," the seller loans you part of his or her home equity. You would borrow the largest portion of the purchase price from a traditional lender and borrow the remainder from the seller. Typically, this type of second mortgage has a higher rate of interest.

No matter your method of putting together down payment money, the satisfaction of reaching the goal of owning your own home will be just as great!

Want to discuss your down payment? Give us a call: 407-834-3377.

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